World Could Get Divided Into Three Blocs, Fortune Predicts

The era of lower trade barriers and growing economic interdependence is waning—and President Donald Trump’s aggressive trade policies are accelerating that shift.

Trump's aggressive tariffs have deepened divisions, prompting even longtime allies to question America’s role in the global order.

Economists at Wells Fargo have outlined a hypothetical scenario in which the world becomes divided into three major trading blocs led by the U.S., China, and the EU, Jason Ma reported for Fortune.

Globalization had already begun retreating before Trump reignited tensions with a sweeping trade war earlier this year.

But his aggressive tariffs have deepened divisions, prompting even longtime allies to question America’s role in the global order. In April, European Commission President Ursula von der Leyen remarked, “The West as we knew it no longer exists.”

Although Trump later pulled back from some of the steepest proposed tariffs, new ones appear imminent. On Thursday, he suggested the U.S. could unilaterally impose tariffs as high as 70% in the coming days.

In a recent note, Wells Fargo economists outlined a scenario where the global economy splinters into three blocs:

• The U.S.-led bloc, encompassing most of the Western Hemisphere as well as traditional allies in Asia and the Middle East.

  
  

• The China-led bloc, including Russia, most of East and Central Asia, top African economies, and some Latin American and Middle Eastern nations.

  
  

• The EU-led bloc, the smallest, composed of the European Union, United Kingdom, Iceland, Norway, Switzerland, Turkey, and Ukraine.

  
  

“Deglobalization has its roots in the geopolitical and economic rivalry between the U.S. and China,” Wells Fargo wrote.

“Recent developments raise the possibility of a further fracturing of the global economic order. Specifically, the notion that the European Union could pursue an independent geopolitical and economic course is no longer unthinkable.”